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Technology Stocks : PSFT - 1997 Outlook [closed thread] -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (748)	1/19/1998 5:21:00 PM
From: William F. Wager, Jr.	Respond to of 940

Value Line estimates 1998 earnings of 0.60: (Q1 0.11 Q2 0.13 Q3 0.16 Q4 0.20). It goes on to say that very little of the revenue stream is derived from the Asian region, a real plus for the stock. In addition, Release 7.0 and 7.5 should allow it to capitalize in both the U.S. and Europe. Finally, the y2k problem should benefit the company since customers are likely to purchase new software, rather than rely solely on revamped versions of their legacy applications. The stock is rated a buy and Value Line has it in its "Stocks for Per- formance" portfolio. This portfolio also contains MSFT BMCS HBOC NETA SCI VTSS LLTC in the tech area.

To: Chuzzlewit who wrote (748)	1/20/1998 11:34:00 AM
From: Mr Logic	Read Replies (2) \| Respond to of 940

If growth averages 50% over the next 5 years, PSFT is a $6bn REVENUE company by Dec 2002 - must be twice (or more, I can't remember) what SAP is expected to do in 1997. Is Peoplesoft going to be twice as big as SAP is now? And if PSFT gets to $6bn revenue at current profitability, and stays there for ever, the p/e would be 10 which justifies a stock price of... about $35 (npv of the eps for ever). Or if profitability improves to net 25%, about $70/shr. I do find it amazing that some stocks have this kind of high pe when you work out what it means in reality. Patrick.